Ford studies new models to drive Lincoln revival

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Lincoln designers had to sculpt “multiple iterations” of the front end to get the proportions right on the MKC Concept.

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FORD

The interior of the MKC Concept is styled to evoke coolness and serenity in keeping with the kind of brand character Lincoln aims to create -- a contrast to what Lincoln sees as more aggressive designs from rivals.

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DETROIT (Reuters) -- Ford Motor Co. may develop new models for Lincoln in fast-growing vehicle segments as part of the automaker's latest attempt to revive the struggling luxury brand and boost its profits.

The company did not specify which vehicle segments it was targeting. But in a presentation to investors on Thursday, Ford showed in a chart that it expects the premium small-car and crossover segments to grow sharply by 2015.

Lincoln does not currently offer a small car, but a person familiar with the brand's strategy previously told Reuters that the Lincoln brand is considering a near-luxury compact sedan for 2016 or later.

At the Detroit auto show this year, Ford showed a concept version of the Lincoln MKC compact crossover that is expected to go on sale next year.

There are vehicle markets "that we're not playing in today that we can enter that are high-volume segments and growing fast," Matt VanDyke, who is in charge of Lincoln's development and day-to-day operations, said at an investor conference.

If approved, the small sedan likely would be sold in the United States and China, the world's largest auto market. It would compete against cars like General Motors' Cadillac ATS and the Mercedes CLA.

Lincoln accounted for a little less than 4 percent of Ford's U.S. vehicle sales last year. But the luxury market is expected to grow quickly in the United States and China.

Lincoln -- the top-selling U.S. luxury brand in 1998 -- routinely sold more than 100,000 vehicles a year in the United States. Volume peaked at 231,660 units in 1990, but sales have since tumbled amid inadequate investment. Lincoln sold 82,150 vehicles in the United States in 2012, making it the eighth best-selling luxury brand. In comparison, segment leader BMW sold 281,460 vehicles.

Ford is trying to overhaul the Lincoln brand's product lineup and image, and boost sales by developing new models, starting with the MKZ sedan. The automaker also plans to launch the upscale brand in China in the second half of 2014.

But Lincoln's overhaul got off to a shaky start this year when quality and supply issues slowed the MKZ's roll-out. Dealers had expected the sedan by the end of 2012, but inventory reached "normal" levels only this spring.

Company officials said extra checks were needed correct fit and finish problems. Some MKZs were also missing parts due to parts shortages.

Lincoln sales were down 24 percent during the first quarter. But the brand gained momentum in April and May, and during the first five months of 2013, Lincoln sales were down 10.5 percent.